Gov. Newsom’s progress on his key policy promises for California

In his first 100 days in office, California Gov. Gavin Newsom quickly set about launching parts of the progressive agenda he promised during his campaign.

On the day Newsom was sworn into office, the Democrat vowed to expand Medi-Cal coverage for immigrants in the country illegally and drive down the high cost of prescription drugs.

Since then, Newsom has also promised to expand paid family leave, tax credits for low-income workers and early childhood education. He vowed to modernize the state Department of Motor Vehicles, crack down on cities that refused to plan for adequate housing and retool California’s high-speed rail system, which has been plagued by cost overruns.

Newsom also worked behind the scenes to help settle the teachers’ strike in Los Angeles, inflamed California’s feud with President Trump by pulling national guard troops from the U.S.-Mexico border and traveled to Washington, New York and El Salvador.

Susan Kennedy, who served as chief of staff to Gov. Arnold Schwarzenegger and cabinet secretary to Gov. Gray Davis, said one of the most significant moments of Newsom’s first 100 days was his decision to impose a moratorium on the death penalty, for which he won the praise of criminal justice advocates and drew the ire of death penalty supporters, who said the governor defied the will of California voters who refused to abolish the death penalty in a 2016 statewide vote. …

Click here to read the full article from the L.A. Times

Will Gavin Newsom’s Drug Pricing Plan Save You Money?


Pills health careGov. Gavin Newson wants to deliver lower drug prices by harnessing the full weight of the state against the pharmaceutical industry, but it’s unclear whether his team can get a better deal without giving up something Californians want.

In his first act as governor, Newsom issued an executive order creating the largest single purchaser of prescription drugs in the country.

It combines negotiations for some 13 million people in government-administered plans like Medi-Cal and eventually invites other organizations to join. His argument centers on the idea that a bigger organization can extract a better price from pharmaceutical companies.

“We believe this will significantly reduce costs,” he said at a press conference last week, adding that he’d ask other governors if they want to participate. …

Click here to read the full article from the Sacramento Bee

California Doesn’t Have a Budget Surplus


BudgetIt’s become common folklore that California is booming and incoming Gov. Gavin Newsom and the Democratic supermajority have more taxpayer money than they will know how to spend, save or invest. Nothing could be further from the truth; and it’s the California voters and taxpayers who will continue to be pay for this mistake. We literally owe trillions that isn’t being discussed. Just the estimated payments on public employee pensions in California will increase from $31 billion in today’s dollars to $59 billion in 2024; and this number is based on non-recessionary conditions or a major correction in the stock market. And California immediately needs $800 billion to over $1 trillion worth of infrastructure repairs, upgrades and new construction.

A conservative estimate of California’s total debt by the California Policy Center in a 2017 study – before new tax and bond obligations recently voted in were factored – puts California’s total local and state debt at $1.3 trillion. The Stanford University Pension Institute (www.pensiontracker.org) in 2017 calculated California’s unfunded liability at $1.4 trillion and CalPERS also with an unfunded liability of $1.4 trillion, with CalSTRS billions underwater as well to give, “real state debt of $2.8 trillion.”

Whichever calculation is used California owes trillions and doesn’t have a plan in place to address this issue. What should be clear is that California does not have a surplus or anything near a surplus factoring in total debt and infrastructure for a basic, functioning society California citizens and non-citizens expect. This figure also doesn’t factor in health care costs rising under Covered California, Medi-Cal or possibly expanding Medicare to include all Californians living in-state.

These financial and societal facts will affect overall fiscal health and the ability to pay back debts accruing interest or fall under the category of a future obligation. Government services at the state, county and local level are at risk if a recent announcement by the CalPERS board is taken into consideration titled, “Risks Report,” highlighted, “The greatest risk to the system continues to be the ability of employers to make their required contributions.”

Taxpayers will have to make up the shortfall through additional taxes – like eliminating Prop. 13, voting in a VAT or services tax or some combination thereof – otherwise first responder response times, social services for the poor and needy, and environmental standard protocols will erode.

There are other factors California will need to overcome to pay back their debt and realize we do not have a budget surplus. California’s unemployment rate rate is 33rd in the nation at 4.1%. The national unemployment rate is 3.7%. We have the highest taxes in the nation when the variables of the gas tax, state income tax, and sales tax are put into the equation. Additionally, California has the highest housing and rents in the nation per amount of residents. The median home price in California is roughly $544,900 whereas the remainder of the United States is estimated at $220,000. We artificially suppress housing supply (particularly, single-family-home) – though demand hasn’t diminished – driving up prices. Our stringent environmental standards evidenced by CEQA, SB 375, AB 32, SB 100 and CARB is hurting job growth and economic sustainability.

High taxes and regulations; and a tough business environment are some of the reasons why Toyota, Occidental Petroleum, and Nestle USA food conglomerate left California. Now the second largest firm in California – McKesson Pharmaceuticals is seriously contemplating leaving for Texas – according to a report by the San Francisco Business Times. The issue isn’t whether or not these companies leave; instead it’s the high paying jobs with benefits across all income spectrums being driven out of California. Moreover, we need successful firms to assist tackling the trillions we owe in pensions, bond obligations and infrastructure requirements.

After this recent election where it has become proper to bash Republicans – especially California Republicans – many will postulate there is no difference between Republicans and Democrats. When there is nothing farther from the truth. I’m not speaking about politics, which is essentially the means for winning elections and building coalitions for governance, I’m speaking about actual policies. How do you allocate taxpayer money? Do you want to tackle California’s debt or speak about a surplus instead? Do you believe in abortion, gay marriage, some form of socialism? Do you build a larger navy to confront global problems? Do you believe in fracking?

Those are policy decisions that have wide ramifications for California policymakers and voters. The California Democratic Party currently believes in spending more than it takes in by amounts it will never be able to recover; though incoming Governor Newsom showed variables of fiscal restraint as mayor of San Francisco. Of course there are establishment cronies and swamp-dwellers in both parties; but if you only take environmental policy using Tom Steyer as an example there has never been a more powerful oligarch in recent memory.

The planet and California isn’t better off for the policies Mr. Steyer advocates for and our poverty and homelessness continues being the worst in the nation. These are examples of policy decisions similar to believing there is a budget surplus that have long-term, negative ramifications.

What the surplus doesn’t take into account is California’s real poverty rate that the Census Bureau standard now has at 19% and 43.9% higher than the remainder of the US. Disenchantment and disillusionment with both parties is en vogue, but there is to much at stake in our financial future to allow the Democratic supermajority be let off the hook by continuing to spout the mantra of budget surplus.

CA Spent $4 billion on Medi-Cal for People Not Eligible

MedizinCalifornia spent $4 billion on Medi-Cal coverage between 2014 and 2017 for people who may not have been eligible for the government-funded health plan, according to a state audit released Tuesday.

Medi-Cal provides health coverage to 13.1 million Californians, approximately one-third of the state’s population. To qualify, a single adult must make less than $16,754 annually.

County workers typically determine whether someone is eligible for health coverage under Medi-Cal, then send that information to the state. But the records don’t always match up.

The audit found 453,000 beneficiaries who were marked as eligible in the state’s system, but not in the counties’ — indicating that they may not have actually been eligible for Medi-Cal. These beneficiaries may have died, moved or begun making more money and no longer qualified for Medi-Cal. …

Click here to read the full article from the Los Angeles Times

California’s Single-Payer Health Care Plan Would Be Costly and Risky


MedizinSingle-payer health care is e a major issue in California’s 2018 gubernatorial election. Democratic candidate Gavin Newsom has strongly endorsed the idea, while Republican candidate John Cox is opposed. Last year, a single-payer bill, SB 562: The Healthy California Act, passed the state Senate but was placed on hold in the Assembly.

SB 562 would replace the current health care system with a state program under which all provider claims are paid centrally with no network restrictions, deductibles, co-pays, or other limitations. One governing body would replace the current array of public and private insurers. Medicare, Medi-Cal, and the Children’s Health Insurance Program (CHIP) would be integrated into the new system.

Proponents of single-payer primarily tout its ability to move the state towards universal coverage. However, California is already fairly close to achieving universal coverage. The June 2017 CDC report states that only 6.8 percent of Californians are uninsured. The other 93.2 percent already have private insurance, Medi-Cal, or gained insurance through Covered California during the Affordable Care Act (ACA) expansion.

Creating a single-payer health care system would be enormously costly, time-consuming, and difficult from a political and implementation standpoint. If achieving universal coverage is the primary goal, existing insurance schemes and government programs could be expanded to cover the uninsured instead. If Medi-Cal coverage is considered insufficient, it could be enhanced without impacting other categories of insurance.

A major argument from proponents of single-payer is the claim that it saves money by eliminating profits and administrative overhead — money that is going to insurance providers. Relative to all health care costs, these amounts are quite small. Most California residents already have coverage either through the government (Medi-Cal or Medicare) or a non-profit provider (Kaiser Permanente or Blue Shield), so profits only enter into the equation for a minority of Californians. Second, SB 562 would remove incentives to control costs, eliminating managed care. As a result, provider charges would probably increase substantially, overwhelming any savings from the elimination of middlemen.

Kaiser Permanente, the nation’s largest non-profit health plan and the insurer for many Californians, is known for its high quality of care and cost-conscious decision-making. A single-payer system would eliminate managed care organizations, and with them, the years of efficiency gains made to eliminate wasteful spending and improve quality. A statement by Kaiser’s CEO last year emphasized the difference between universal coverage and single-payer, mentioning his hesitations with single payer’s outdated fee-for-service model.

Perhaps the most daunting challenge of a single-payer system is the price tag. Analyses estimate that implementing a single-payer system would cost California between $330 billion and $400 billion per year, and there are reasons to believe that these estimates are too low. To put the potential costs in perspective, the entire California state budget for 2018-2019 is $201.4 billion. SB 562 does not provide details about how funds would be raised to pay for single-payer.

Furthermore, SB 562 has no mention of cost control measures, while explicitly saying there will be no co-pays, deductibles, or premiums. It plans to cover all medically necessary care, including medical, vision, dental, hearing, and reproductive services. Other services like chiropractic care and acupuncture would also be fully covered under the new program.

Many other countries have universal health care coverage and better health outcomes than the United States, an argument frequently used in favor of single-payer. However, many of these countries utilize free-market mechanisms that promote cost-conscious decision-making. These include price transparency, fewer regulations, consumer choice, and cost-sharing to prevent overuse of services.

Aside from the fundamental problems aforementioned, there are considerable political and legal roadblocks associated with implementing a single-payer system in California. Assuming that tax increases would be a necessity for funding purposes, a key obstacle would be gaining the two-thirds vote requirement for passing any such increases in the state legislature. Other obstacles include Proposition 4 of 1979, referred to as the Gann Limit, which limits state and local appropriations. Implementation of a taxpayer-funded single-payer system would necessitate repealing the Gann Limit or exempting the new taxes from the limit. Proposition 98, passed in 1988, requires that a certain amount of state tax revenues be diverted toward education funding and taxes for a single-payer system would fall into this category. So, once again, voters would have to approve exempting these new taxes from Prop. 98.

Proponents of the single-payer system believe that the new taxes needed to fund it could be addressed in legislation without requiring voter approval. The California Budget & Policy Center sees this as “very unlikely,” since it would require amending the state Constitution. When it comes to Proposition 98, the likelihood of exempting new taxes is less clear, since it depends on differences between the General Fund and Special Fund, potentially opening the door to a lawsuit.

Much uncertainty exists about the possibility of rolling federal funding into the California Health Fund (a new fund from which the state government would pay all medical expenses). The federal government funds Medicare and most of Medi-Cal, setting or at least influencing eligibility rules. This creates a hurdle to covering undocumented immigrants; federal funds are currently not allowed to finance any of the social services provided to this population.

The combination of the political and legal complications, SB 562’s enormous price tag, and the lack of cost-control measures and long-term funding uncertainties need to be carefully considered by Californians. Vermont tried to implement a single-payer health care system in 2014 but ultimately abandoned it following a myriad of challenges. Vermont had a population of 625,000 residents at the time. California’s is home to nearly 40 million people. Increasing access to health care is a laudable goal, but changes to the system should focus on improving health care outcomes for patients and  improving the quality and affordability of care. Increasing the state government’s role in health care is unlikely to deliver those results.

This article was originally published by Reason.com

Bill to Provide Free Healthcare for Adult Illegal Aliens Dies in CA Legislature


MedizinCalifornia Senate Bill 974, which would provide for “full-scope” Medi-Cal health benefits to all illegal aliens, died in the State Assembly after concerns about up to $3 billion in new costs.

“SB-974 Medi-Cal: Immigration Status: Adults” failed quietly in the Assembly’s Appropriation Committee on August 18, despite an effort to save part of the bill by reducing the cost of taxpayer coverage to $200 million by only covering adult illegal aliens 65 years and older.

After the Democrat-controlled California legislature passed “Health for All Kids” (SB 75) in 2016, which extended full Medi-Cal benefits to 200,000 illegal alien children under the age of 19, Senator Ricardo Lara (D-Bell Gardens) promised that he would fight to expand coverage to all adults who would be eligible, regardless of their immigration status.

When Lara introduced SB 974 on April 2, he told Politico that despite President Donald Trump’s crackdown on immigration, California Democrats continue to believe that health care is a civil right for all residents. “California has never waited for the federal government, or for a political climate, to be able to take leadership on a whole host of issues,” he said.

Lara and other California Democrats had been claiming that there would be no added taxpayer burden from SB 974, because California is already paying for poor undocumented adult illegal aliens through emergency rooms across the state.

But the non-partisan California Legislative Analyst’s Office (LAO) examination in May of the financial impacts of SB 974 revealed the cost for extending the coverage to full-scope Medi-Cal coverage for all eligible adult illegal aliens would be $4.74 billion — a $3 billion increase in the taxpayer burden above what is currently provided to illegal aliens through emergency rooms alone. …

Click here to read the full article from Breitbart.com/California

CA Budget: 9% increase considered “frugal” by Democrats


California Gov. Jerry Brown points to a chart showing the growth of the state's Rainy Day fund as as he discusses his proposed 2018-19 state budget at a news conference Wednesday, Jan. 10, 2018, in Sacramento, Calif. Brown proposed a $131.7 billion state spending plan, dedicating $5 billion toward the fund. (AP Photo/Rich Pedroncelli)

When the annual California budget debate began inearnest with Gov. Jerry Brown’s release of a proposed 2018-19 fiscal plan in January, progressives were ready to go with a long list of new spending proposals. Many hoped to both expand the social safety net and to make existing state welfare programs more generous.

But nearly six months later, as final work on the budget wraps up, Brown’s dominance of state finances has gone all but unchallenged. Any assumption that a lame-duck governor in his final year would have less clout has long since been disproved.

For the fiscal year which begins Sunday, the state will have a $138.6 billion general fund. Spending on special funds dedicated to specific programs and on bond debt will bring the total overall budget to $199.6 billion.

Brown made some concessions during the budget process. The state will spend an additional $600 million on programs to help local governments deal with homelessness; give an additional $344 million to the CSU and UC systems; and provide $90 million more for monthly CALworks welfare payments.

But new spending is dwarfed by the billions of dollars the state continues to set aside in reserves. Nearly $14 billion is expected to be in the state’s “rainy day” fund and $2 billion more in other funds by the end of fiscal 2018-19 – so much so that the state may soon have to cut the sales tax to prevent reserves from exceeding constitutional limits.

The governor has emphasized building up reserves because of his frequently voiced belief that the state is overdue for a recession. Because by far the state’s biggest source of money is income and capital-gains taxes paid by the very wealthy, revenue can plunge rapidly when Silicon Valley stumbles. A decade ago, in the first fiscal year after the Great Recession, revenue fell $20 billion – leading to cuts in spending on public education and welfare programs under Brown’s predecessor, Arnold Schwarzenegger.

The freshness of this budget pain in the memories of dozens of long-serving state lawmakers has made even some ardent liberals open to the governor’s relative frugality.

No expansion of Medi-Cal to undocumented adults

This was evident in the resolution of the fight over access to Medi-Cal, the state program providing health care to the poor. Some Bay Area and Los Angeles County Democrats pushed hard for giving regular, full access to the subsidized care to older unauthorized immigrants, not just to children, as is now the case.

But the governor never budged. All progressives got out of Brown was an agreement to form a commission that will “broadly study California’s health care needs” – a concession that was dismissed as meaningless by some groups which had hoped for much more, according to a Los Angeles Times report. Cynthia Buiza, executive director of the California Immigrant Policy Center, told the Times that the “budget deal is devastating for the health of all that call California home. … We are specifically disappointed that our low-income immigrant neighbors, friends, colleagues and communities will continue to suffer from [Medi-Cal] exclusion.”

Republican lawmakers were largely on the sidelines in shaping the budget. While some praise Brown for restraining his fellow Democrats, others challenge the narrative that he is frugal. A recent budget op-ed in the Los Angeles Times offered some support for this skepticism. It noted that total spending will go up by 9 percent from the current fiscal year to the next one – more than four times the rate of inflation.

California one step closer to expanding Medicaid for illegal immigrants

Healthcare costsCalifornia is one step closer to expanding Medicaid for illegal immigrants in the state, with legislation from both chambers of the legislature that could reach Democratic Gov. Jerry Brown’s desk.

The California State Assembly last week passed a measure that would expand a current program, introduced in 2015 by Brown, which provided Medi-Cal coverage for undocumented minors under the age of 19. The new legislation, introduced by Democratic State Assemblymember Dr. Joaquin Arambula, expands that program to cover undocumented young adults up to age 26.

“The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions,” the Assembly bill read. “The federal Medicaid program prohibits payment to a state for medical assistance furnished to an alien who is not lawfully admitted for permanent residence or otherwise permanently residing in the United States under color of law.”

Arambula’s bill was initially slated to cover all undocumented adults, but was amended to expand coverage to just young adults under 26 years of age. That bill is expected to be considered in the California State Senate. …

Click here to read the full article from Fox News

CA Democrats Pushing to Give Illegal Adults Full Health Care Benefits


MedizinCalifornia Democrats are reportedly pushing to give full healthcare benefits to illegal immigrant adults, which would mean that the Golden State not only may have to raise taxes but will also be a magnet for even more illegal immigrants.

According to a Monday Politico report, state Senator Ricardo Lara (D-Bell Gardens) is leading the charge by reportedly arguing that “California needs to be a laboratory for social change by taking the lead on progressive causes.”

“We are trying to address the fact that, whether you like it or not, our undocumented community needs the care, and we are paying for it anyway,” he reportedly said.

Politico points out that California Democrats are trying to extend the state’s Medi-Cal program this legislative session to nearly 1.2 million illegal immigrant adults who would qualify for it, and “companion bills in the state Assembly and Senate” have already “passed their respective health committees with party-line votes.”

The cost to expand Medicaid coverage to adult illegal immigrants in California is reportedly projected to cost $3 billion annually.

California Governor Jerry Brown, who extended Medi-Cal coverage to illegal immigrant children in 2015, has not commented on the pending measures but “is required by law to sign or veto bills passed this session by Sept. 30, just five weeks before the midterm elections.”

Political and health analysts are reportedly astounded that Democrats are trying to extend healthcare benefits to illegal immigrants before this year’s important midterm elections, reportedly saying that the measure would give Republicans in California relevance “they would never have before” in an election cycle in which House races in California could decide which party controls Congress.

Paul Ginsburg, director of the USC-Brookings Schaeffer Initiative for Health Policy, told Politico that the proposal would be “fiscally very dangerous” and  Jay Bhattacharya, a Stanford physician and health economist, suggested to the outlet that such a plan would have to be paid for with tax increases.

Bhattacharya also pointed out the obvious—giving full healthcare coverage to illegal immigrant adults will make California, which is already an official “sanctuary” state, even a greater magnet for illegal immigrants.

The illegal immigrant who murdered Kate Steinle, for instance, told authorities that he came to San Francisco after being previously deported five times because he knew San Francisco was proudly a “sanctuary city.”

“If you make a program like this available, undocumented workers in other states might be attracted to California because of this,” Bhattacharya, the Stanford physician, reportedly said.

This article was originally published by Breitbart.com/California

Assembly wants to spend $1 billion on health coverage for illegal immigrants


California, flush with cash from an expanding economy, would eventually spend $1 billion a year to provide health care to immigrants living in the state illegally under a proposal announced Wednesday by Democratic lawmakers.

The proposal would eliminate legal residency requirements in California’s Medicaid program, known as Medi-Cal, as the state has already done for young people up to age 19.

It’s part of $4.3 billion in new spending proposed by Assemblyman Phil Ting, a San Francisco Democrat who leads the budget committee. Assembly Democrats also want to expand a tax credit for the working poor, boost preschool and child care, and increase college scholarships to reduce reliance on student loans.

They also would commit $3.2 billion more than required to state budget reserves. …

Click here to read the full article from the Sacramento Bee